Understanding Immigrant Self-Employment: Alternative Choice or Utilizing Advantages?

Abstract

Immigrants have long been believed to take on self-employment at higher rates than native-born people, a tendency that is regarded as contributing to their integration in the host countries. This thesis examines the factors that drive immigrants to become self-employed in the United States, and tests hypotheses derived from several popular theoretical approaches to immigrant self-employment. The study uses data from the General Social Survey and employs logit models to test the degree to which several potential drivers affect immigrants’ likelihood of being self-employed. The findings reveal the experience of unemployment pushes immigrants to take on self-employment. This contrasts sharply with unemployment’ effects for native-born Americans, for whom it poses a substantial barrier to starting a business. The results imply that many immigrants are pushed to be self-employed by various restrictions or barriers, rather than taking on self-employment in response to the greater economic opportunities it offers.